Anthony Holmes - Management Idiot?

According to his biography in today's Sunday Times Appointments Section on page 6, Anthony Holmes describes himself as an international corporate turnaround specialist and transitional leadership expert. Sounds good.

His article is about the Postal Strike and situation at the Royal Mail asserts how a leader is required and not a manager. It is his opinion that Winston Churchill would be the ideal man for the job to solve the current stand off between Union and management as his wartime 'quintessential leadership' would help take the situation by the scruff of its neck.

Anthony Holmes is no doubt an intelligent man but Churchill, while indisputably a fantastic wartime leader who led Britain to survival and victory at our direst hour, had previous form when it came to strikes.

Churchill solved the General Strike by sending in troops - an action that arguably strengthened the resolve of workers and unions in Britain for the best part of 90 years. His actions were despised so greatly that someone as mild as my grandmother could not speak his name without invoking the dire days of his methods to solve the strikes which profoundly affected the people in South Wales in particular. It even tarnished his undoubted genius of wartime leadership in her humble eyes.

If Holmes had bothered to look into Churchill's past, he would have realised that Churchill would have had only one method of solving the stand off - to send in troops to break the strike and force the workers to accept whatever their fate was deemed to be by a truly incompetent and overpaid management. What a super idea that would be.

Perhaps those employing Mr. Holmes for his specialism and expertise aren't actually too worried about his experience, qualifications, knowledge of his subject or historical characters. Like Ron Sandler, his price is reassuringly expensive enough to not ask questions.

'My Farts Smell Better Than Yours'

I think most people would agree a fart is a fart. I suppose there are those connoisseurs of the subject who would claim that some are more powerful, deadly or obnoxious than others but in reality they are pretty unpleasant generally.

Why do I mention this odd subject? Well, I have just listened to the weekly puerile urinating contest which is euphemistically called Prime Minister's Question Time. It has been a dodgy old week for the PM as the news that the size of our economy has been over taken by Italy's was not ideal but the fact that we have now experienced 6 quarters of successive contraction of our economy denoting the most prolonged recession since records began has taken some precedence. It gets worse for the PM as he has been somehow persuaded to go lobbying in Europe to have Tony Blair elected as the first permanent President of the EU. It could not have got much worse when David Cameron fired a few salvos at him about the economy.

Perhaps the PM has led a sheltered life but he grimly clung onto the notion that despite the obviously dire economical position the country finds itself in, when he has repeatedly claimed that Britain had a superb economy and so would not be badly affected by any recession, he actually argued well at least it was better than if the country had followed the Conservative policies. To round that illogical argument off, he claimed that unemployment was ONLY 2.5m and that he had proved that for every decision he had made on the economy he was right and the conservatives were wrong.

It's the kind of daft thinking that comes from desperate people but sometimes you have to believe your own bull. He basically argued that he had 'farted' but at least it wasn't as smelly as Cameron's.

The fact remains that prior to the whole crash the bill for those claiming benefits for being unable to work was at an all time high while unemployment is now at a higher percentage than when Labour took office. Finally, despite all reassurances to the contrary, our recession continues to dog us despite the enormous amount of 'Stimulus' we had given it and we have not even tried to get rid of wastage on the annual public sector budget, let alone start prioritising spends.

It could be described as monumental hubris as opposed to sound financial acumen, yet that has been the path followed in order to get us into this mess so we should not be surprised that it is the same methodology used to try to rescue us.

The one moment of 'victory' for the PM was the announcement that the EC will not stand in the way of the plan to split up Northern Rock so that the profitable bit can be sold off while the smelly bit with all the dodgy debts in is retained and underwritten by the taxpayer. In doing so, the PM claimed this had saved 3,000 jobs by nationalising the bank and now the public could get some of its money back while underwriting the toxic debts of the 'bad bank' left behind.

For those of us with an iota of intelligence, we will have noticed that the first prospective bidder is none other than Virgin who actually made an offer for the bank when it hit the crisis. At that point, the Government argued that the deal did not inject enough capital in and so rejected it for nationalisation instead. A while down the line, Virgin will bid for the profitable bit and not have to provide any capital for the smelly part. It may be argued that the same deal could have been done at the onset of all this and the same number of jobs been saved as the public would have had to have underwritten the whole thing then and now. So we have paid £90,000 per month for Sandler's fees and much more for the army of consultants used just to get back to the same basic position. Some 'victory'.

It about sums up the whole economic policy of this Government - a whole load of knee jerk reactions costing £1.4 trillion which has not got us anywhere. The whole process of rescue has been one colossal 'fart'. But at least it smelt better than the Conservative's fart, had they indeed been in a position to exercise their muscles.

Small comfort as we view the potential cost of the economic mess we are in.

Rock Unsolid

Here's a conundrum. The Government stepped in to save Northern Rock in February 2008 by nationalising it. When they did so, they assumed the bank was no longer a going concern and so severely wrote down its value.

By doing so, they offered to pay far lower compensation to shareholders than they should have done. Those shareholders have now run the matter through court and their appeal against the Government's actions and for higher compensation has been defeated.

The Government's argument is that the bank had been loaned £45bn prior to the nationalisation, without which the bank would have failed and therefore the shareholders would have seen their investment reduced to nothing. The Government, therefore argues that they were doing the shareholders a favour.

It is a difficult situation. The Government did indeed rescue Northern Rock but at the time there were other avenues that could have been explored. When nationalised, the entire liabilities of the bank were assumed by the taxpayer, some £100bn and we are by no means clear of danger although the Rock has been paying back considerable amounts of its loan. Danger was unjustifiably increased when the interim CEO, Ron Sandler, somehow allowed the Rock to continue to hand out 125% mortgages, the very product that nearly killed the bank, for a good 6 months after nationalisation. Then Sandler and is team almost unilaterally renegotiated the terms of its loan facilities from the taxpayer in order to offer around £14bn of new mortgages.

There were two alternatives at the time. One was that Northern Rock was sold as a 'going concern' albeit with its liabilities effectively underwritten by the taxpayer for a period to someone like Virgin One who argued that the Rock brand was defunct and that Virgin would revive it by offering their own branded products. The Government argued that the Virgin plan did not inject enough capital into the Rock and therefore it was not viable. The second option was to let it go bust in the same manner as the Fed did with Lehmans and let others pick over the parts of the business which were viable.

In many respects what happened gave the worst of both worlds. The taxpayer ended up covering the entire liability anyway, we gave the loans, we were exposed to the stupid extra 125% loans, we paid the bonuses to the Rock staff just for repaying some of the debt, we pay the vast bills for Sandler and his army of consultants, we allowed the Rock to renegotiate the deal to save itself and the juicy assets of really nice mortgages were tied up in a vehicle called 'Granite' which we do not own. Meanwhile, the shareholders got shafted whereas, arguably, with Virgin's management and skills they could have shared in some future profit as part of the Virgin brand and you can bet your life Sandler, the daft mortgages and bonuses for loan repayments would not have featured in the equation.

There is another aspect to this case, though. As the Credit Crunch unfolded and major bank after major bank revealed their stupidity, the Government actions veered markedly from its action on the Rock. Almost as if they realised they were stupid to have nationalised the Rock, they tried a variety of other methods to save the other banks such as HBOS, Lloyds, and RBS.

Two major cases are very prominent. First, events triggered the Government to virtually force Lloyds to buy HBOS against all anti-competition rules and all good advice. Immediately, both banks came cap in hand to the Treasury and we had to save the entire new group to the extent that we now own nearly 50% of the new Lloyds Group. What the Government did was to fund an anti-competitive takeover that now gives the new Group an unhealthy 28% of the UK mortgage market. The shareholders of both HBOS and Lloyds, in the wake of one of the most ill advised takeovers you could imagine as Lloyds discovered the extent of the HBOS situation as it was not allowed to do full due diligence and pay the right price thanks to Government intervention at the highest level, they also stepped in to save the skins of Lloyds shareholders so that they may benefit in the future from any rise in the market. The Rock shareholders were afforded no such luxury.

Secondly, as Bradford & Bingley sank, the Government allowed Santander, a Spanish bank, to increase its share in the UK market after already buying Abbey and Alliance & Leicester by letting it buy only the bits it wanted - the juicy ones of course. On top of this, the Government later proposed the Asset Protection Scheme which allowed banks to ring-fence their toxic debt and have the taxpayer 'insure it' by paying a premium.

If any or all of the above options had been allowed for Northern Rock, it is arguable that while the shareholders would have lost out in the short term they would have reaped some benefit as the markets recovered as the shareholders of all other banks will. The argument here is that the nationalisation of the Rock was a knee-jerk reaction that cost us all a great deal of money, it was mismanaged and there were alternatives, particularly after the Government sat down and thought about it.

Personally, I was in favour of the Rock going under and then bought for a song by some other bank who would have done a better job than Sandler, who for all his excessive fees has only done the obvious. I do not have a great deal of sympathy for the shareholders in the Rock, even now as it was a bank that had traded on a substantially flawed model that was cruising for a disaster. However, in the light of the actions to save other banks, the shareholders have a very good point. All other banks offered loans, guarantees and capital were effectively saved by the Government and respected the interests of shareholders. The Rock was a fiasco that benefited no one - least of all the British taxpayer.

I dare say, the 'rescue' of the Rock will feature in future Economics lectures, although hopefully long after they have rewritten their text books and fired the lecturers. They got it all so horribly wrong, after all.

Time For Pay Back?

Just when we thought it was one way traffic and all the money was flying out of our pockets, the news is that Northern Rock will probably be sold later this year and we can get some of those £ billions paid back committed on our behalf.

Well, it won't actually work like that. You see, Northern Rock will be split into two before such a sale occurs. One half will be a pristine looking, well financed company with lots of new customers going to it and probably sold for around £2 billion which will constitute a net loss to the taxpayer of around £1 billion (oh, and that's a good thing, by the way, as the original forecast was to lose £1.3 billion).

The other half of the bank will be the 'Bad Bank' full of those stinky toxic debts and our erstwhile investment company, UKFI, who manage our portfolio of failed banks, are busily headhunting for a CEO for 'Bad Bank'. What a job that will be - doesn't matter how they do because the losses are so huge they surely cannot get any worse. Sure fire winner - I hear Fred Goodwin is available.

This suits the Government nicely as they can validly claim there is a way to exit all this manifest stupidity of buying into all the banks to save them. The fact that we make a 33% loss on the deal is neither here nor there, at least there was an end date.

Possible buyers for the 'Good Bank' are Virgin Money and National Australia Bank. You may remember that Virgin One had been one of the bidders at the time of NR's glorious failure but the Government rebuffed the idea to handle matters themselves. £90k per month later for Ron Sandler, £ millions on armies of consultants and several bonuses for staff for repaying some of the vast amount of money they owe and the very same company can buy the cleared up balance sheet for a song with no vast liabilities tied around their necks. We are left with all of those as we would hate to get rid of them.

So in summary - we buy a failed bank, pay millions in fees to do the obvious, sell the best part for way below what we paid for the whole lot, then be saddled with the real toxic debt worth £ billions. Super plan, must have been worth all the £ millions of advice paid to the investment back advisers for that one - I could have come up with it for the price a beer and packet of salt & vinegar.

It about sums up Alistair Darling - grade A pillock.

When Governments And Commerce Collide

There is a good reason why Governments interfering in commerce is not a good idea and that's because they generally change the rules or allow it to happen. As we have seen in the past with the Railtrack fiasco, even if companies get into trouble, nationalisation should be a place of last resort.

What we are seeing in this financial crisis is a series of knee jerk reactions which typically end up favouring certain businesses and markets over others and the same can be said for individuals. While people with mortgages have had their woes eased, those saving for the long term have been hammered seeing not only their investments trashed heavily in the stock market dive but to add to their heartache their savings are not getting anything either.

Northern Rock

The same can be said of bondholders at Northern Rock. While it could be said the bank would have gone bust without Government intervention, people who funded it previously stand to lose out considerably as new proposals are forwarded by the Government-paid clever Consultants swarming all over the Rock.

Northern Rock has now revealed it is to create a 'Bad Bank' of its own to park its 'Toxic Debts' as a spin off so that it can start relending in the mortgage markets where there are lucrative rewards to be made in a new risk-clear legal entity. How very convenient.

Of course, in the real world of commerce such a thing could not happen and certainly not without some recourse in law. However, creditors who hold the bonds fear they will get dumped into the 'Bad Bank' and the Northern Rock bond prices have slumped on the news. It will not have escaped their notice that around £12bn in bonds were held and the new mortgage funding Northern Rock will release will be £14bn.

Bonus Bonanza

In the bizarre world of the bank bail outs and Credit Crunch fiascoes, despite announcing a £1.4bn loss, Northern Rock will be paying its staff and 100 executives a nice chunk of bonuses, principally as they hit their deadlines of paying off £18bn of the £27bn we loaned them. Of course, we as taxpayers get no bonus for helping them out as the buck stops at us but while we hand out money, companies can do what they like with it. I don't suppose we have a great deal of sympathy for the holders of the £12bn of bonds but it must gag in their throat to see what is going on here.

Having clapped themselves on the back for paying us back on time, there is a catch to be heard. Naturally, now that Northern Rock has fulfilled part of its obligation, it can change the rules. It has now decided to start relending in the mortgage market to make fat profits again and therefore it will pay us the rest of the money back at a much slower rate, which means they can pay themselves whacking bonuses on the profits to be made.

We must be mad, but that's what we agreed to.

Government Interference

This all started when the Government took over Bradford & Bingley. They unilaterally rewrote contracts which would delay capital repayments and reduce interest - see, it's easy when you are not subject to the law. This affected what is known as the sub-debt market where these bonds are traded and spreads became far wider as creditors started to panic.

It's fine to do it right now but of course this has long term repercussions. The sub-debt market is a vital area for all companies to raise money by issuing bonds upon which interest is paid at an agreed fixed rate. If the Government is going to start playing God in these markets then potential creditors will just walk away. While that may be a viable risk in the short term to get banks out of the mess they are in, going back to it in the future will be difficult. This has a potential spin off in the equity market where nationalisation plays havoc anyway. In reality, the City is very dependent on what the Government does today to ensure it is a long-term viable centre for capital raising. At this moment, the prognosis does not look too good.

Losses & Losers

Gary Hoffman, CEO at Northern Rock, whose puppet strings are pulled by the Consultant Ron Sandler, confirmed the taxpayer would not be paying anything further than the £3bn of capital we promised in August claiming this was enough capital to manage good and bad assets.

However, capital is being used pretty quickly there. Northern Rock suffered £1.4bn in losses in 2008, writing off £900m of bad debts and they are expected to make significant losses in 2009. The FSA has already had to waive its rules again with Northern Rock on its capital levels, you might have thought now was the most important time to be very hard. The fear is that the £3bn new capital is already blown and that creditors will be the ones holding the new losses.

Never Mind That - Lend!

Northern Rock, under the original plan, was due to return to profit and be free of our generosity by 2012 - which seems long enough, quite frankly. However, Hoffman has now confirmed that the strategy has been 'suspended' to allow it to lend the £14bn over two years at up to 90% loan to value. How nice of them to consult us before informing us they are re-inventing the rules. In fact, it is no longer apparent when Northern Rock will once again be a private company as the executives seem to see a great opportunity to have 'the best of both worlds', i.e. to make whopping profits on loans and capital they have unrestricted access to on their own terms which they can change as and when they like. It's too good to be true - but it is. How a private company would love to have such wonderful terms to raise funds, yet banks are having this luxury.

In fact, having paid back £18bn of its £27bn loan from us, it plans to slow its repayments in order to borrow a further £10bn to support the new lending while its bonus payments are a mere snip at just £9m although senior staff may get deferred bonuses in the form of loan notes - slightly dangerous as Norther Rock now has a policy of changing loan terms whenever it wishes.

We are a generous lot, we taxpayers, you know. We have also granted Bradford & Bingley the right to pay £1.7m in bonuses and a further £1.3m in deferred bonuses to senior managers who busted the company.

Wake up - the coffee smells great!

Amazing But True

They could be showcases in Mr. Ripley's amazing exhibitions but we have become immune to some of the amazing statistics we have been fed lately.

I nearly cried when I found that Andy Hornby, the lad next door former Marketing Manager at Asda who rose to become CEO of HBOS and made a good and proper show of ending the Bank's life by clocking up a £10bn loss, has waived his right to a monthly retainer. In a show of public-spiritedness which will no doubt twang the heart-strings of every warm blooded mammal he has voluntarily given up his right to a £60,000 month retainer at the bank. If the details of the £10bn loss had somehow slipped past the press, I dare say he would have carried on drawing the money reluctantly as reward for crashing what was a perfectly decent bank at some point.

Of course, I dare say he learnt the art of asking for pocket-ripping retainers from Ron Sandler, who got his 'Happy Gilmore' monthly pay out for 'rescuing' Northern Rock which we now own as taxpayers. We all happily agreed to his £90,000 per month retainer and the fact he has pulled in an army of consultants to whoop it up on the taxpayer bonanza to 'put the bank right' again and even showed his generosity on our behalf by paying staff a 10% bonus just for paying the back some of the money they borrowed - from us.

Easy Money

Even that does not take the biscuit. My perennial blog target, John Thain, former CEO at Merrill's who did an 'Oliver' and asked for more bonus himself having wrecked the bank so much it had to be bought by BoA - he only wanted $10m. But he had the last laugh as the stingy Board turned him down. At that point they were not aware he had signed $billions in executive bonuses to his pals just days before the takeover at BoA went through, and had somehow blown $1.2m on redecorating his office which he has now admitted was a 'mistake' and has agreed to pay back. What a guy.

But dear old Fred Goodwin now former CEO of RBS, has proven to be a generous sort as well. Despite his bank clocking up a £30bn loss and has laid off 13,000 staff so far, tears will well-up when everyone finds out that just a few weeks before he got so unfairly sacked for busting the bank, he signed off several lucrative contracts to individuals to become 'global ambassadors' to RBS. With contracts up to 5 years, these 'ambassadors' include Zara Phillips, Jack Nicklaus, Jackie Stewart and Sachin Tendulkar - and their job was to just stand about ambassadoring. RBS was always a bit choked that rival HSBC had bought space in all airport jetways and so it began on a global campaign to hijack every sporting event it could think of and now sponsors Williams Formula 1 Team, the Rugby Six Nations (Wales are Grand Slam holders), the Nat West series in cricket, the British Open in Golf and the World Underwater Nude Tiddlywinks Championship this year in Watford swimming baths - this latter one is still pending approval as I only sent the application off this morning.

We should mourn 'Sir Fred' for his overwhelming largess. But that wasn't as generous as his leaving terms as he earned £4.2m a year and although he was rather spitefully not given a wedge of cash for his failure, he did exit with an £8.4m pension pot.

Bank officials are now a little bit cheesed off that they cannot undo some of these daft deals but that would mean someone getting off their backside, employing a decent lawyer, calling up Sachin, Zara and her brother Peter who oversees the Williams F1 deal in Asia for RBS, and telling them to take a hike. But that would be impolite - besides it's only a collective £200m of taxpayer money at stake.

Let's not stop there. As Gordon Brown surrounds himself with fabulously rich banking advisers which is a really great idea as they advise us all to bail out banks and allow them to carry paying themselves fat bonuses, we are slowly finding out his who's who of the banking world are some of richest, dodgiest fat cats of them all. Latest on the list of dodgy dealers is the former US Citigroup banker who managed get himself a $42m pay off. A mere 45 years old, Michael Klein, former Vice Chairman of making money at Citigroup, quit last July just before the spectactulars really kicked in and Citigroup had to get $45bn to save itself and got his massive pay off. So he would be superbly qualified to advise Brown on how to rescue the banking system, then.

Allegedly, the scoop at the Treasury, is that Klein has to approve everything before it becomes policy. Klein, now a freelance 'adviser', is described as a 'rainmaker' in the banking world. He certainly made it rain - it bloody well poured, all $45bn of it.

Failure Is A Good Thing

Clocking up $45bn and getting a $42m pay off is pretty spectacular even for a rainmaker. We see in business and sport that in fact it is far more lucrative to fail than succeed. In fact the more spectacularly and quickly you fail, the quicker you earn the value of your contract and resurface at a new job to start the jamboree all over again. Just ask Sven Goran Eriksson or Steve McLaren - there was zero incentive to succeed when you could earn as much in quicker time by failing. And the same goes for 'Big Phil' Scolari at Chelsea, who this week got fired from his wonder-job. Along with Jose Mourinho and Avram Grant, Chelsea have paid out a total of £28m to be rid of their failed managers (although in fairness Mourinho did win 6 trophies and Grant lost the European Champions League only on penalties).

You must think that Chelsea must have a small chimpanzee who makes out such stupid contracts. No way, it is the highly paid CEO, Peter Kenyon. You have to have real brains to be that stupid, believe me.

Of course, you would have to be really stupid to employ clever people who actually gave a damn about silly things at Watchdogs. They have really bared their teeth lately over at the FSA and copped an Essex Forex trader who allegedly had a £44m fraud going. Good stuff, they only missed the entire banking meltdown which has cost around £800bn so far in the process and the Madoff $50bn scam.

Good work everyone, bonuses and part time fat-cat jobs all round.

I Can Do That

The world would not seem right if we did not hear of a bit of management lunacy. We find this week that BT, that bastion of management common sense, is paying around 1,000 workers to do nothing.

These individuals are part of the Career Transition Centre and were set up to retrain employees to find work elsewhere in the business instead of BT resorting to redundancies. A noble thought, indeed.

Sadly, as the recession bit and lack of planning came to the fore, it meant that there are fewer posts to fill at struggling BT and last week it announced it has laid off around 9,500 workers. This has given rise to a large amount of employees who are languishing at home waiting for something to do. Cleverly, Ian Livingston, the CEO at BT, has focused his job cuts on consultants and contractors at BT - whole armies of them that sprang up to advise about how to outsource and ruin the business. The company has 90,000 UK employees and over 110,000 worldwide, some just sitting in small offices in foreign countries, advising. In fact, when you include contractors, BT had around 160,000 people working for it so the odd 1,000 sitting waiting to do something was neither here nor there.

You couldn't make it up.

Finally, Spare A Thought For....

Eric Daniels, CEO of the new Lloyds Banking Group who, with other banking alumni, was called up in front of the beaks this week. He described the takeover of HBOS as being expected to be painful but strategically good. Bong, a few days later we find £10bn went down the toilet and we, the taxpayer, stumped up for it - so yes that was indeed painful. Daniels should not have any excuse - the City did warn profusely that HBOS had been suicidal in its Corporate lending and many of their super bets have gone belly up including Stead & Simpson, Wyevale and Crest Nicholson.

Bless him - Daniels said that they would have normally have done a good deal more due diligence in such a takeover despite the obvious warning signs but frankly with a Government gun to his head he probably did not have much choice.

Now, on a final note about Andy Hornby, the former CEO at HBOS, who has given up his lucrative retainer, we will not have heard the last of him. After presiding over hiring and firing a £1m banker called Benny Higgins from RBS who had pleaded that HBOS should have a more conservative mortgage book so much so that HBOS sold only 8% of mortgages in the first 6 months of 2007, after Higgins had slashed the commission paid to brokers and advisers. Hornby fired him and soon spectacularly reversed that so that HBOS once again got to 22% of the mortgage market with some of the most daft lending and sales tactics you will find.

And he had the gall to ask for a £60,000 a month retainer - respect to the balls of the man. Now, who was the idiot who agreed to pay it? That's you, silly, the taxpayer. In fact we are stupid enough to unquestioningly pay for it all and will be doing so for some years to come.

The last laugh is on us.

They Must Have Seen You Coming, Mate

Mr. Brown is VERY angry. Yvette Cooper is in a right legal tizz. Meanwhile bankers at RBS are paying themselves £1bn worth of bonuses.

What did we expect?

Sick Joke

It's not just that this is greed on a scale that is so appalling as to wonder what goes through the minds of people who think that they are entitled to bonuses when their activities put their bank into public ownership and reduced its value to only a few multiples of the collective bonus they now propose to pay themselves, but it is the incredible lack of thought and planning by the Government to have not even thought of covering this off.

It's a sick joke beyond the imagination of most decent people.

'Asleep On The Job'

From Brown, Darling and Cooper's position, it is as David Cameron put it - a case 'Sleeping on the job'. It really is no use Gordon Brown being 'angry' about it now that it's in the public domain - the Government, while using the taxpayer's money with such generosity, had a moral and legal obligation to have covered this off as a precondition of any bail out.

As far as the credibility of these ministers go, it is cut to shreds. Most people would have thought of this but it is entirely in keeping with the slipshod, knee jerk series of reactions to their stupid policies going wrong which got us here - and they did not pay enough attention to warning signs before the debacle so perhaps we should not have expected anything different in the execution of the so-called 'rescue' mission.

Badly Advised

I come back to a central point of mine. Brown and Darling have surrounded themselves with Investment Bankers at incredible cost to the taxpayer to rescue us from the very catastrophe they caused. It comes as no surprise that their advice seems to overlook penalising their colleagues in the banking world. Indeed, you can bet your life their smarmy, expensive advice was that in order for the machine to restart, adequate incentives needed to be kept in place to tempt the executives into playing ball.

Just as at Northern Rock where Ron Sandler, earning nicely himself, is paying bonuses to staff just for repaying what they owe the taxpayer, the banking mentality is one of mega-money - and it's where numbers like millions do not cut it any longer as they were so 1980s.

Like the whole credit crunch and recession, this was entirely a predictable result of the bail outs.

It really is time we all voted with our feet. Just think if the British public withheld their tax cheques until the Government got this mess sorted out to ensure to a penny goes in bonus to anyone in a bank part owned by the taxpayer.

Now that would be some incentive to get things right, would it not?